S&P: LMI Aerospace loan B+

Standard & Poor's said it assigned a B+ corporate credit rating to LMI Aerospace Inc.

The agency also said it assigned a B+ issue rating and 3 recovery rating to the proposed $325 million secured first-lien credit facility, which consists of a $100 million revolver and a $225 million term loan.

The 3 recovery rating indicates 50% to 70% expected recovery in a default.

The outlook is stable.

The ratings reflect an expectation that leverage will improve steadily over the next 12 months because of earnings growth and some debt reduction from free cash flow, said Christopher DeNicolo, an S&P analyst.

The agency said it believes revenues and earnings will show solid growth over the next year because of strength in commercial aerospace market and good positions on popular aircraft programs, the analyst said.

The company's business risk profile is considered weak, reflecting its position as a tier II aerostructures supplier to the cyclical and competitive commercial aerospace market, S&P said, along with its relatively good customer and program diversity and efficient operations.

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